Even if a meat shortage doesn’t hit Florida, farmers will hurt

The coronavirus is causing national meat processing plant shutdowns. That could spell trouble for Florida cattle ranchers.
Braford cows graze in a beef cattle pasture at the Range Cattle Research and Education Center in Ona, Fla.
Braford cows graze in a beef cattle pasture at the Range Cattle Research and Education Center in Ona, Fla. [ TYLER JONES | Photo courtesy UF/IFAS ]
Published April 17, 2020|Updated April 17, 2020

When Smithfield Foods, the country’s largest producer of packaged meats, announced it would be temporarily shutting down one of its plants after employees at the facility tested positive for COVID-19, it prompted questions about the nation’s meat supply.

The company produces 4 to 5 percent of all U.S. pork, supplying close to 130 million servings a day. And it’s not the only large meatpacking facility that has been forced to temporarily shutter due to the pandemic — other major meat processing plants including Tyson Foods’ Iowa pork plant and a JBS beef plant in Colorado followed suit. Smithfield Foods CEO Kenneth Sullivan didn’t mince words when he said that the effects felt by the shutdown were “...pushing our country perilously close to the edge in terms of our meat supply.”

“It is impossible to keep our grocery stores stocked if our plants are not running,” Sullivan said in a release.

But what exactly does that mean? Will there be a run on bacon?

Probably not, said Julie Anna Potts, the president and CEO for the North American Meat Institute, a meat packing and industry trade association.

“We do not currently foresee a time when America will run out of meat,” Potts said in an email.

Though the situation is changing daily, Potts said her organization is “working hard to ensure America has meat,” and pointed to a “variety of reasons” that grocery store shelves might go without certain items on any given day, including pandemic stockpiling.

In Tampa Bay, grocers are still fairly well stocked when it comes to meat, and many local outlets did not seem particularly concerned about that part of the supply chain breaking down.

Maria Brous, a spokeswoman for Publix, said the local chain has “several” pork suppliers, and that Smithfield Foods is one of the smaller ones. The South Dakota Smithfield plant that closed didn’t supply Publix with any fresh pork, Brous said.

A herd of White Angus cows and calves graze in a pasture at the Range Cattle Research and Education Center in Ona, Florida.
A herd of White Angus cows and calves graze in a pasture at the Range Cattle Research and Education Center in Ona, Florida. [ TYLER JONES | Courtesy of UF/IFAS ]

That doesn’t mean all is calm in the meat industry. The nationwide shutdown of restaurants coupled with an increased demand for meat amid pandemic shopping has thrown a wrench into a carefully calibrated system that is now struggling to keep up.

For one thing, cuts of meat typically sold to restaurants are different from what shoppers want at grocery stores, and packaging plants have had to find ways to quickly adapt while trying to avoid waste.

In Florida specifically, the real brunt of the strained supply chain will be felt by livestock farmers, said Chris Prevatt, a state specialized extension agent at the University of Florida’s Institute of Food and Agricultural Sciences Range Cattle Research and Education Center.

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Local livestock farmers, not consumers, will suffer the immediate consequences of meat packaging plant shutdowns, Prevatt said. For Florida’s robust beef cattle industry, that could spell trouble. Florida currently ranks 13th in U.S. cattle production, with more than 15,000 beef producers throughout Florida, according to the Florida Beef Council. Florida-based names like Deseret Cattle and Lykes Bros. Inc. are among the largest cattle producers in the country.

Roughly 90 percent of the beef produced in Florida is shipped to out-of-state feedlots and large meat processors like Smithfield Foods. Every step of the supply chain has felt the strain of the shutdowns, Prevatt said, from those involved with transporting meat across state lines to feedlot operators, processors and cattle farmers.

On the consumer side, Prevatt said this strained supply chain could lead to a slight uptick in meat prices, which shoppers could see in their local grocery stores. And while he said there is no immediate concern about a meat shortage, the longer this goes on, the more likely one becomes.

“If this only lasts for 14 days, there won’t be shortages, it’s just going to put a strain on our supply chain,“ he said. “If we stay in this scenario for 30 to 45 days — absolutely. There will be shortages.”

When massive meat processing operations like Smithfield Foods shut down, it jams up a system that due to coronavirus-related factors is already operating at a lower capacity. Livestock that arrives at packed feedlots has nowhere to go, creating a backup of product despite an increased demand from consumers. Local livestock farmers are having to pay extra to feed animals for much longer than they usually would.

“Everything is going to be backlogged, and in terms of live animals that means we have to feed them longer," Prevatt said. “We have to keep these live animals going — we can’t just hit stop.”

Prevatt, whose job involves evaluating and marketing all feeder calves that leave Florida, said the local cattle industry began feeling the economic effects of COVID-19 as early as January. He estimated that cattle farmers in Florida are currently losing between $200 and $300 per feeder calf, and that those losses could get worse.

Further complicating matters for cattle farmers is the fact that, before the coronavirus pandemic, beef pricing was the lowest it’s been since 2010, meaning farmers were not getting paid as much for their livestock as they once were. According to Fern’s Ag Insider, which tracks the food and agriculture industry, cattle prices have fallen as much as 25 percent while wholesale prices have surged amid an increased demand from stockpiling shoppers.

Amid a fear that local meat processing plants might also shut down, some smaller livestock farm operations in Florida have been looking to get USDA certified so they can process their own meat. There are a few smaller cattle ranchers and hog farmers in the state who currently process their own meat, which often comes at a higher price for consumers.

Heidi Adams runs the HertaBerkSchwein Farms in Groveland, Fla., and is currently setting up her small, family-run operation to become a USDA-certified processing plant. The business sells heritage breed Hereford hogs to upscale restaurants and hotels in Miami, a process that was abruptly cut short in March when restaurants were ordered to shut down.

“All of a sudden they were not taking any more product,” Adams said. “It was just a stunner for us."

Heritage breeds like Hereford hogs are bred at HertaBerkSchwein Farms in Groveland, which before COVID-19 sold mostly to upscale South Florida restaurants.
Heritage breeds like Hereford hogs are bred at HertaBerkSchwein Farms in Groveland, which before COVID-19 sold mostly to upscale South Florida restaurants. [ Courtesy of Heidi Adams ]

Like larger livestock farmers, the disappearing clients meant a backlog of animals with nowhere to go. Adams estimated that she spends close to $7,000 a month feeding her pigs.

“Animals across the board for all farms do not stop eating," she said. "You can’t just turn around and say, hey I’m going to sell these animals and take them off the feed lot.”

But despite the restaurant drop, Adams said their business has found new footing with local customers — shoppers that would rather buy local and directly from the farm than go to the grocery store.

Related: Tampa Bay farmers and markets find new customers as grocery stores empty

Like Adams’ operation, small farmers are finding that, despite the loss of large restaurant accounts, there is a growing demand for locally sourced chicken, beef and pork. It’s a small silver lining in an industry that, although much smaller in scale than their large, national counterparts, has also felt the impact of COVID-19.

We don’t yet know how far-reaching the effects of coronavirus-related meat processing shutdowns will be. But livestock farmers and industry advocates like Prevatt hope the $9.5 billion in agricultural financial assistance that’s part of the $2 trillion government stimulus bill known as the CARES act will help mitigate some of the damages for Florida’s cattle producers.

Still, some losses seem inevitable.

“We’re going to lose some cattle producers,” Prevatt said. “Whether that’s 5, 10 or 15 percent — we don’t know."